Flexible Spending Accounts (FSA): Saving Employer's and Employee's Money
Also referred to as cafeteria plans or Section 125 plans, these accounts allow employees to set aside a portion of each paycheck into an account before paying income taxes. Throughout the year, participating employees have access to this account for reimbursement of expenses not covered by insurance such as, over the counter medications; doctor and prescription drug copays; chiropractic care; contact lenses; eyeglasses; dental costs; day care; cost of parking at work; mass transit to and from work.
Additional features of a FSA are:
- Tax-free contributions mean employee and employer savings on federal income taxes, state and local taxes (where applicable) and social security taxes (if applicable).
- Regular corporations, partnerships, S-corporations, limited liability companies (LLC's), sole proprietors, professional corporations, and not-for-profits can all offer these plans to their employees and benefit from the tax savings. However, regulations prohibit a sole proprietor, partner, members of a LLC, or individuals owning more than 2% of an S-corporation from participating.
- Tax savings on employee paid portions of medical, dental and vision premiums.
Pricing:
First Year Setup and Plan Document Design Fee -- $750
Includes Plan Document, SPD, consultation, employee communications, website.
Maintenance & Compliance Fee -- $50/month
Includes account management, participant assistance,
reconciliation and reporting of employee balances,
discrimination testing.
Participant Administrative Charge -- $5.25 per participant/month
Includes 24 hour access, employee statements,
account balance tracking, claims adjudication,
claims payment.
Debit Card -- Free
(optional) includes 2 cards
For more information, please contact us or visit www.125plan.com.